Does Universal Preschool Hit the Target?

Abstract

ABSTRACT This study examines the cost efficacy of universal programs, taking advantage of the rich diversity in rules governing access to state-funded preschool in the United States. Using age-eligibility rules for identification, I find that attending a state-funded universal preschool generates substantial immediate test score gains, particularly for low-income children. Gains for low-income children from attending targeted (largely means-tested) preschool are significantly smaller. Cross-state differences in alternative care options, demographics, and other program features cannot explain the difference in attendance impacts across program types. Benefit-to-cost ratios of universal programs are favorable despite their relatively high costs per low-income child.